I think what is really going on is that Disney wants to discount their programs on THEIR OWN distribution system, and price them higher on Apple's.

But what annoys me is that this is a "rental." -- I mean, can't we go back and watch it again later? I can store something off the TV and Cable right now and not have to deal with this.

More inconvenience again. It's really silly for LEGITIMATE buyers. The people UNENCUMBERED by DRM are people who just download the episode -- but the people PAYING, have a DRM, time and location limited "rental." It's already nonsense with all the content getting made -- there is more than I can possibly watch on Dish Network. 99% of it I don't care to see -- so "al a carte" is a great idea.

But "al a carte" with some chains on it -- is just annoying. I probably will throw away old episodes of TV-shows and such, but in a blue moon, I have a "keeper." Letting me have a NON-DRM file does not mean that people won't pay $.99 for the convenience of their own "stuff."

Price it low, and people will spend MORE money with this, and there won't be a pirate market. Price it high, and LESS overall money will be spent, and you create an incentive to go outside your network.

Maybe they just REALLY like calling the FBI to hunt down college students and make life miserable -- it would figure.

This issue is pretty complex with a lot of players with eventual harm to a lot of business models. This isn’t about simply ignoring a new revenue stream with no negative impact on other revenue streams.

And why the defense of Cable and Satellite as a means of “saving money” on TV Show viewing when Netflix, Hulu are considerably cheap, and even free for regular Hulu? That makes no sense, unless you are purposely ignoring the cons of the cable and satellite while ignoring the pros of non-Cable TV or Satellite based media.

Yes - these are entrenched business models with guaranteed revenue streams for the content providers. There is no doubt that the everything is changing but there are many big players looking to the future for not only growth but also survival. Everyone is stepping cautiously into the new world. I can't see it any other way than that the cable operators who now have a lot of control are the ones that will loose out. That's why there is consolidation happening out there. Bell in Canada just bought CTV, the number one TV network (in Canada) for that very reason.

>>The president and CEO of CTV Globemedia, Ivan Fecan, said CTV’s content will help Bell and CTV grow. “In today’s digital age, it is extremely important to be a part of a vertically integrated company that can take advantage of content over multiple screens,” said Fecan, who added that the deal will “accelerate Bell’s video growth across all three screens – mobile, online and TV.” <<

I hope that in the future I will be able to create my own menu of programs and to be able to watch them when and where I want. I would also like to be able to adjust the number of ads I will be subjected to (pay more or less for rental) but I can't really see that happening. What is certain is that as a consumer I may get more options but I will still be fleeced.

A business model that doesn't take into account what is happening in the real world is doomed. If Apple doesn't turn everything inside out now, some other company will. To operate in denial is to guarantee failure.

Since you end up paying more per episode for a la carte downloading than you do with a DVD/Blu-ray boxset, that's why I find iTunes pricing extremely abusing if you want HD stuff.

$72/season for 24 episodes of a season compared to $50 for higher quality and you can do whatever you want with the disc just doesn't make sense to me in the long run. And because of that, I NEVER buy iTunes episodes. And since there's such a discrepancy, if I want to watch an episode on my iPhone, I torrent it since I will NOT support business models which exist to screw the customer of all their money (I do buy the Bluray when they get a bit cheaper).

$72/season for 24 episodes of a season compared to $50 for higher quality and you can do whatever you want with the disc just doesn't make sense to me in the long run.

Are you people just having a laugh or can you not see how getting the episodes the next day for 99¢ to have in your device as you are traveling and to watch offline (if needed) the next day with no ads couldn’t possibly be a good solution for someone over the internet-reliant-whilst-viewing, ad supported Hulu or the have-to-wait-up-to-a-year-for-the-discs-to-be-released-so-I-can-get caught-up-on-the-episode-I-missed-before-watching-the-rest-in-a-series-model?

I usually get my TV shows for torrents and never watch actual TV, but that doesn’t mean that this option is overpriced or stupid because it doesn’t fit my needs.

Dick Applebaum on whether the iPad is a personal computer: "BTW, I am posting this from my iPad pc while sitting on the throne... personal enough for you?"

Along the lines of $1 being 'too cheap' to rent a show, I picked up the entire Stargate series (hey, light semi-SF my kids can watch...) of something like 220 episodes for $70 on DVD from Amazon, so $0.33/episode - purchased, not rented. It would have cost several times that on iTunes - upper $200's or into the $300's, IIRC.

Same for Farscape - iTunes would run $160, and buying on Amazon was $60 for something like 88 episodes plus bonus materials. Where in the HELL are these idiots coming up with this online pricing? Renting one time for a 20 minute show with no real distribution is set to cost more than buying full hour-long episodes on disc? I have to say... pound sand, studios, I'll pick it up cheaper elsewhere. Let me rent for $0.25 for older shows and $0.50 for newer stuff and we'll talk, guys.

Along the lines of $1 being 'too cheap' to rent a show, I picked up the entire Stargate series (hey, light semi-SF my kids can watch...) of something like 220 episodes for $70 on DVD from Amazon, so $0.33/episode - purchased, not rented. It would have cost several times that on iTunes - upper $200's or into the $300's, IIRC.

Same for Farscape - iTunes would run $160, and buying on Amazon was $60 for something like 88 episodes plus bonus materials. Where in the HELL are these idiots coming up with this online pricing? Renting one time for a 20 minute show with no real distribution is set to cost more than buying full hour-long episodes on disc? I have to say... pound sand, studios, I'll pick it up cheaper elsewhere. Let me rent for $0.25 for older shows and $0.50 for newer stuff and we'll talk, guys.

WTF is wrong with some of you? Youre comparing TV shows that have been off the air for years to the ability to rent or buys shows the day after they air.

Dick Applebaum on whether the iPad is a personal computer: "BTW, I am posting this from my iPad pc while sitting on the throne... personal enough for you?"

Cost has nothing to do with what it's worth to rent the program. I'm not sure what people are willing to pay. iTunes has demonstrated the markets success with 99 cent songs. TV programs so far are a different product, most of which can be viewed for free at the network homepage or via Hulu. It can be viewed on these sites as many times as the consumer wants without a fee, other than the time it takes to watch the 30 second commercial pieces. Maybe for some this inconvenience is worth the trade off, but I don't think the benefit of an ad free experience in this case is enough to warrant even 99 cent rentals, let alone a higher price. If warner brothers wants to charge more for the product, let them sell it. If people buy it, then I suppose the price will prove itself worth it. I've purchased one full season of a program on iTunes. I enjoy it. But as a consumer with limited resources, and one who enjoys film and good quality story writing, I'm willing to watch commercials (even in the theatre), or spend a few minutes writing emails or channel surfing during the short break.

Are you people just having a laugh or can you not see how getting the episodes the next day for 99¢ to have in your device as you are traveling and to watch offline...

You make a fair point but for $10 a month and a slingbox (apx $99 one time) I can do a DVR and see their crap and everyone else's. So sure I might miss an episode cause the DVR had a brain fart and/or didn't have room or I forgot etc so then I'd be left with either renting and/or finding alternative ways to view the missed episode OR simply forget about it since one missed program isn't gonna destroy my world (like it might have when I was younger).

Now at 99 cents that means I'd need to have 10 shows per month that I find palatable enough to want to view... Now given the current caliber of content coming from the studios you might be right...

Hey all I know is if the studios want to make accessing their programming difficult and or expensive then they are certainly succeeding. The problem is kids today are not a slave to the boob-tube like us kids that grew up in the 70's and 80's... These kids have A TON of other ways to amuse themselves and speaking as someone who has a niece and a nephew they don't watch any of the major network programming at all. (I guess Saturday morning cartoons aren't as great as I remember em).

Hey if they think their being smart squeezing out every dime they can they've got another thing coming when the kids of today continue to NOT watch their programming.

Are you people just having a laugh or can you not see how getting the episodes the next day for 99¢ to have in your device as you are traveling and to watch offline (if needed) the next day with no ads couldnt possibly be a good solution for someone over the internet-reliant-whilst-viewing, ad supported Hulu or the have-to-wait-up-to-a-year-for-the-discs-to-be-released-model-so-I-can-get caught-up-on-the-episode-I-missed-before-watching-the-rest-in-a-series-model?

You win the highest density of dashes per sentence and the most-words-linked-by-dashes-to-make-a-compound-noun awards!

They spoke of the sayings and doings of their commander, the grand duke, and told stories of his kindness and irascibility.

Let's see. They're willing to have Amazon SELL the episodes for $1.99 to $2.99 each (mostly $1.99), but they won't rent them for $0.99?

Idiots.

I suspect it's a tacit admission that they don't really imagine most episodes sold in this fashion will get watched more than once. So a sale = a rental, in that sense. And they're looking and saying, hey, why accept $1 when we could get $2 or $3? They've got a model like this:

The current model (Model 1) has sales only. The proposed model (Model 2) has both...

You and I feel that's not true. But it might be. If they're right, then it's inconvenient to you and me, but correct for them. If it's not true, then the guys who are going to a rental model will see an increase in their bottom line.

(all of this ignores Apple's cut, but that just changes the constants a bit)

Once again, we see a bunch of high paid, out of touch executives suggesting something that makes no sense. Frankly, higher quality TV might garner a higher rental price. What these bonehead executives need to do is consider what the true value of their product actually is. Bet they have never measured that ... though certainly somewhat subjective, you get what you pay for. 99 cents is the most I would pay for to rent (one time) some show.

Perhaps they need to look at their cost structure (you know, the $300 lunches on Rodeo Drive) before suggesting that $1 to rent (RENT!) a show is not enough.

I just bought House season 6 new on Blu-ray from half.com for $33. 21 episodes. That's $1.57/episode: I own it. There are no ads, no bumpers, no bugs, no banners and no ratings symbols. It's 1080p. The compression is the lowest you will ever see (and the audio is lossless surround sound).

I just bought House season 6 new on Blu-ray from half.com for $33. 21 episodes. That's $1.57/episode: I own it. There are no ads, no bumpers, no bugs, no banners and no ratings symbols. It's 1080p. The compression is the lowest you will ever see (and the audio is lossless surround sound).

This, dear executives, is the benchmark by which I am judging you.

How much is the DVD for this weeks episode of The Universe on total eclipses? Im going on a flight tomorrow and I want to watch it on the plane.

Dick Applebaum on whether the iPad is a personal computer: "BTW, I am posting this from my iPad pc while sitting on the throne... personal enough for you?"

I won't be dropping cable any time soon. Sure I have to endure commercials, but I find them a very useful break to deal with dinner and family. When I watch PBS I inevitably miss important action while I stir something on the stove, get a kid into pajamas, use the bathroom, etc. I know digital downloads would solve the pausing the show problem, but PBS shows aren't available on iTunes.

Cable gives me:
1. a choice of 24 hour cartoon channels for the kids
2. live sports
3. local news
4. game shows I would never pay for
5. $15/month off the cost of my internet and phone

If I miss an episode of a favourite drama I must have been doing something important. I can't imagine paying extra and trying to find time outside my normal TV watching hours to see it. I have far better things to do with my time and money.

You're all a bunch of out-of-touch relics. Due to your short-sightedness, millions of people will now download your shows, with all the commercials cut out, for free. so instead of receiving 99 cents per episode (or over $20 per season, nearly the cost of buying instead of renting--what a scam) you now get zilch.

So you can rent a TV series from Blockbuster 1 disc at a time. Each disc holds about 4 episodes. So each episode is valued at 99 cents in that model. How is Apple's different?

Let's not forget some discs have about 8 episodes on them, which means the value is half that.

Welcome to the digital age.

WRT Blockbuster, they buy a physical disk. They can then do pretty much anything they want with the disk, including selling it or renting it.

WRT Apple, they sign a contract for the right to create and transmit an additional copy of the work. So the rights they have are ceded by the content owner, with no First Sale Doctrine to protect the consumer.

As the consumer, I'm not interesting in paying more than $0.99 cents for a TV show. Watching a whole season of your show simply gets too expensive. It's not viable. I could spend my money on a lot of other things that would make more sense (like Netflix).

I'm sure Pepsi would prefer to charge $5.00 for a 2-liter, but the market demands cheaper products. Either figure out how to hit the $0.99 cent price point or don't expect many people to be buying your shows.

Thank you,
Andrew

P.S. If your high price points make people not buy your shows, don't blame it on piracy and go crying to the public. This is your problem, not ours. Pepsi doesn't blame poor sales on store theft, neither should you.

Although I totally agree with this, I have to think that Apple itself plays this game. I'd like a Macbook Pro, but it's too expensive for me. If you have the only game in town, people who really want to play will pay it. You may lose volume profit but, like Apple, gain high revenue. Granted $0.99 is way to high for a episode that may be good or junk, but it's their product and they have the right to price it. I personally think the studios are stupid and will regret their choice in the long term, but have you paid $5.00 for a medium bag of popcorn or $3.00 for half filled small box of candy in the theater lately? That on top of almost 10 bucks for the ticket. Yet people keep paying it!

Hows about we just start the old-fashioned boycott? Vote with our wallets and let WB find out what WE think the prices should be

Of course, I don't watch any of that stuff so I'm already on board.

Unfortunately (like my other post) people WILL pay it if they want it. It's easy to call for a boycott when the product doesn't mean that much to you. The studios know through experience that the boycott will fail. I believe in your boycott, and I am strong willed, but then again, I do really like eating popcorn at the theater.

The theory behind boycotting is a sound one, but people have to be totally pissed off or willing to hold off on principle for it to work.

Although I totally agree with this, I have to think that Apple itself plays this game. I'd like a Macbook Pro, but it's too expensive for me. If you have the only game in town, people who really want to play will pay it. You may lose volume profit but, like Apple, gain high revenue. Granted $0.99 is way to high for a episode that may be good or junk, but it's their product and they have the right to price it. I personally think the studios are stupid and will regret their choice in the long term, but have you paid $5.00 for a medium bag of popcorn or $3.00 for half filled small box of candy in the theater lately? That on top of almost 10 bucks for the ticket. Yet people keep paying it!

Know the way to make a cheap Mac? Give up the rights to anything but the OS. Stop making hardware that ties to it. Let every fab in the world make hardware that runs the Mac OS. Charge a license from the manufacturers only. Then we'd have Macs that are identical to the competition. And a larger slice of the market.

I won't be dropping cable any time soon. Sure I have to endure commercials, but I find them a very useful break to deal with dinner and family. When I watch PBS I inevitably miss important action while I stir something on the stove, get a kid into pajamas, use the bathroom, etc. I know digital downloads would solve the pausing the show problem, but PBS shows aren't available on iTunes.

Cable gives me:
1. a choice of 24 hour cartoon channels for the kids
2. live sports
3. local news
4. game shows I would never pay for
5. $15/month off the cost of my internet and phone

If I miss an episode of a favourite drama I must have been doing something important. I can't imagine paying extra and trying to find time outside my normal TV watching hours to see it. I have far better things to do with my time and money.

Why isn't PBS TV on iTunes, I wonder? PBS needs the money.

Sure, for live sports, fine. Cartoon channels, fine.

I think cable subscribers need freedom of choice. A la carte is the way. So you'd take ESPN, live sports, you'd want the local channels -- you can get those on antennas, you know, great picture, uncompressed 1080i -- but do you want the whole Comedy channel, or just "The Daily Show"? Everything else is like the app store. Otherwise, you pay just for whatever speed of cable you want. And that price should stay the same whether you want cable or not.

It's the coercion I don't like. I want the basic channels. I'd buy a few, like the news channels and Comedy Central, and maybe HBO. Why am I paying for the disgusting, stupid channels? Why should I be subjected to Kim Kardashian and her mentally challenged family?

When digital overtakes the crappy old cable world, turning on the TV will be a menu of choices. Your free podcasts and TV shows paid for with ads, the ones you buy, the "group orders," like the whole ongoing season of Mad Men or whatever, and some free samples in the program store.

What do you need the top-down broadcast model for? Live events. Actual news as it breaks. Making a Skype call to your girlfriend. Get it?

1) The networks currently make money from cable TV companies, who force consumers to pay high monthly fees for a package of hundreds of channels, most of which the consumers don't want.. The networks make additional money from selling ads on all those channels, including the unwanted ones. If they were to facilitate Apple's a la carte business model, this would reduce the number of people willing to pay for cable, thereby threatening their two main revenue streams. Of course, this ignores the fact that cable TV's days are numbered, but then corporate executives (especially those in the entertainment industry) are rarely known for their strategic, visionary thinking. Their compensation packages are based on maintaining their stock price and showing profits from one quarter to the next - not planning for their companies' long term survival and profitability.

2) As a side note to #1, advertising rates are based on bullshit ratings services like Nielsen. A shift in viewership to digital devices would come with highly detailed and accurate analytics that would reveal just how little people care about most of their programming, destroying advertising rates for said programs.

I hear you but we already get those 7 shows now...for $70 via Dish. What we're want/hope is to get those shows and only those shows for say....$30-$40. If Apple TV can get that to us, that'll just be one more Apple product in a long list of Apple products in our house.

7 shows x 4 weeks = 28$ per month on apple tv 99c rentals. So you get those shows for say 28 per month maybe...

There is no show on any channel, at any price, that is worth paying for. Movies (and series) are another thing however, which is why Netflix is the deal of the century, as long as you don't mind not watching the most recent episode.

WTF is wrong with some of you? Youre comparing TV shows that have been off the air for years to the ability to rent or buys shows the day after they air.

OK, first off that's a nice and rude comment, but here's the deal:

1st off, iTunes is _selling_ those same older shows for WAY more than you can buy them on DVD - oh wait, the episodes cost the same amount as NEW shows! - which indicates to me that the studios are totally jacking the prices on iTunes.

Secondly, the fact that there is NO pricing allowance for 1 hour vs. 1/2 hour shows indicating there's a certain level of price fixing - or are you under the impression that networks run the same number of ads normally in 1 hour as in 1/2 hour? I'd get pricing by popularity as judged by Nielsen ratings since they get higher rates for ads, but that's not what's going on, is it?

Finally, based on your comment:

Quote:

Originally Posted by solipsism

I usually get my TV shows for torrents and never watch actual TV, but that doesnt mean that this option is overpriced or stupid because it doesnt fit my needs.

Now I'd say back to you: WTF is wrong with you? In one answer you're commenting that you're grabbing your shows from torrents - I'm going to go out on a limb and assume they're not torrents set up by the studios at $0.99/episode for rent? - and then rudely wonder what is 'wrong with' us for looking at TV show pricing? Paying doesn't fit your needs apparently, but if others think maybe the studios should consider at least getting iTunes prices in line with other channels that we're just off our rockers? Talk about throwing friggin' stones.

I have already pre-ordered my AppleTV and intend to rent a few more shows than I might have just to help ensure that it's a big success, but mostly to spite Warner Bros. and other short sighted greedsters.

Now I'd say back to you: WTF is wrong with you? In one answer you're commenting that you're grabbing your shows from torrents - I'm going to go out on a limb and assume they're not torrents set up by the studios at $0.99/episode for rent? - and then rudely wonder what is 'wrong with' us for looking at TV show pricing? Paying doesn't fit your needs apparently, but if others think maybe the studios should consider at least getting iTunes prices in line with other channels that we're just off our rockers? Talk about throwing friggin’ stones.

Being objective means I can see the viability and usefulness of a business model without needing it myself. I can see why people would want an iPod Touch or a pickup truck, but neither fits my needs and likely never will, yet I am not going onto internet forums stating how foolish it is to create a product that doesn’t fit my particular needs.

Dick Applebaum on whether the iPad is a personal computer: "BTW, I am posting this from my iPad pc while sitting on the throne... personal enough for you?"

At anything more than 99 cents, NO ONE will EVER rent a TV show. Period. It's not a movie. It's not even a SEASON. it's ONE TV show. time to get real.

It's media that has already been subsidized and then some by the commercials that aired with it. the cost involved in the making of the TV show has already been alleviated. Everyone got paid. the show aired and made a profit.

Now, they simply take the existing media, manufacture it to disc and sell it at Best buy, Wal-Mart, etc. with that, they have to pay media cost, graphic design of the exterior as well as the implementation of menus, etc, manufacturing of the box, printing of the literature inside as well as the disc labels and the box art. then they have to pay for the materials of the DVDs and the cases. Then they have to ship. for a season, you are sometimes paying $2 per episode for very popular shows, which is understandable with that cost of manufacturing as shipping. This is all icing on the cake. They are making a good profit on this.

so the TV studios create the show for TV. It airs and does well. THEN they take already created media and package it for even further distribution and make much more from a product they have already made a return on.

Then there is iTunes. the studios have to do basically NOTHING to get it ready for iTunes. The itunes Plus menus are already done. The files were created during DVD manufacturing. there is no box to make, no discs to manufacture and print, no literature to publish, no shipping costs to incur, no shelf space overhead, no designers to pay... nothing. they simply send the files to Apple, who does the work and stores the files on their servers. The TV studios then sit back and watch as their bank accounts accrue revenue from every single purcha... excuse me... RENTAL. And that is a whole other story. Itunes involves even less overhead than Netflix and yet the Studios make way less money back from netflix, yet they want to cry over iTunes? I don't think so. Complaining when someone (Apple) has made it easier than ever for you to make more while doing less is not a way to garner fans (or customers).

this guy either needs to get let go by WB or wake up to reality. I personally won't be renting except once in a great while, as it makes more sense to own, but for thos who prefer to rent, feel free to let this guy know that 99 cents is the limit of what we are willing to pay. Not a cent more. I work a little too hard for my dollar than to let some greedy sleazeball overcharge from something that he has to invest nearly nothing into by the time it gets to my iTunes app.

Know the way to make a cheap Mac? Give up the rights to anything but the OS. Stop making hardware that ties to it. Let every fab in the world make hardware that runs the Mac OS. Charge a license from the manufacturers only. Then we'd have Macs that are identical to the competition. And a larger slice of the market.

And start looking like everything else.

If the Mac were like everyone else's PC, the issue would moot. I like Apple products because they are better than everyone else. The clones in the past affected the brand badly. I know because it had me thinking of getting Windose because my clone constantly crashed. I instead got a real Mac and the crashes disappeared. The Mac ecosystem is the best solution for people who just want to use a computer.

But you do understand, don't you, that you would be renting in lieu of Dish, not in addition to it?

Quote:

Originally Posted by OllieWallieWhiskers

That is only 4 or 5 episodes per show for $70 via Dish... right now, you are paying about $2 per episode...

Apple's model will cut your bill in half.

Quote:

Originally Posted by OllieWallieWhiskers

So... $168 a year is too much? Most people pay $700 a year for cable... just sayin...

Quote:

Originally Posted by jsmythe00

I hear you but we already get those 7 shows now...for $70 via Dish. What we're want/hope is to get those shows and only those shows for say....$30-$40. If Apple TV can get that to us, that'll just be one more Apple product in a long list of Apple products in our house.

Also, in one extreme case we even wait a year to see Dexter on Netflix vs paying the $11 to watch it on showtime.

Quote:

Originally Posted by jsmythe00

Between me and my girl we watch...7 shows. At 24 episodes a season that's 168 bucks/season!!! And that doesn't include the BS channels you get with Dish.

If Apple or anyone else wants a model like this to work they need to charge something like 4.99 a season! Anything more and it really doesn't pay to switch from my $70 Dish plan. $24/season is just way too much.

Using logic will only confuse him more than he already is. He just doesn't understand the concept of using streaming to REPLACE the monthly Dish subscription.

"A common mistake that people make when trying to design something completely foolproof is to underestimate the ingenuity of complete fools." Douglas Adams

Mr. Executive, meet the market. In fact, 99 cents is probably too high but stick to your guns, lose money, and do some power point presentations showing how your company's losses were not your fault. After all, you have your golden parachute under the desk so it's all good.

It's precisely this kind of rubbish that makes me wonder how I even survived for a few years in the corporate world.

Does this guy know how easy it is to download TV shows on torrents? With RSS, its virtually automatic. Plus because TV is free-to-air and available streaming, people also feel much less guilty about "pirating" TV shows compared to movies.

As soon as 99c TV show rentals were available I thought I'd finally catch up with Lost final season, and in HD as well. That's because I missed the swarm when Lost was out, and it's a pain to get good, fast HD torrents. No regrets from me. I guess that's $15 or so that went to ABC that WB just doesn't give a shite about.

Business seems to be in two modes. The first is establishing it, which is very different from the second, which is sitting on your butt when you're big in the industry and your just circulating capital around and playing musical chairs with top management.

And don't forget as well that the 99c rentals are HDCP protected for HD shows. Absolutely ridiculous, it means you can't connect your Mac laptop to a big screen via VGA or DVI, you have to use HDMI and a HDMI HDCP TV or monitor, otherwise no big screen 99c viewing for you... Ironically, this is only restricted on newer Macs with miniDisplayPort. An older Macbook with miniDVI is not affected.

There are some serious, fundamental flaws in the media and games distribution industry where they continue to PUNISH people that actually want to legitimately ACTUALLY SINCERELY AND HONESTLY GIVE YOU THEIR MONEY FOR A PRODUCT.

Apple is not perfect but without iTunes store for music going DRM free for music and music videos, the music industry would be in bad, bad shape. At least the movie studios are slowly coming on board, DRM'ed though... A pity the standard of movies have utterly gone down the toilet.

You can buy them on DVD for apx 1.50 an episode and get extras and bonus crap.

You're missing the fact that they're unlikely to rent an episode more than once and the $1.50-$2.00 may be more in line with what they'd like to see as a minimum sale. On a dvd you're obviously buying the whole seasons, even if half the episodes sucked, so it's not really the same thing. The extras and stuff are just there to entice people who are fans of the show that have already watched most of these on cable. Having rentals at numbers like $.99 is obviously designing to a price point, which may or may not accommodate the margins they are used to. I have a feeling they want to maintain some kind of precedence in pricing here as it may be harder to increase pricing over time than it is for cable companies to raise the subscription cost. You may eventually see a subscription model emerge from one of these sources as it guarantees a minimum sale /season.